Dow Futures Gain As Apple Leads Big Tech Earnings Blowout; Amazon and Facebook to Power Nasdaq Near Record Highs

The S&P 500, which has gained just 0.48% for the year, significantly lags the Nasdaq's 22.7% surge, which is set to rise even higher following blowout earnings from Apple, Amazon, Facebook and Google.

The Friday Market Minute

  • Global stocks mixed on the final trading day of the month, with Asia held down by recovery concerns and Europe and the US rising on big tech earnings.
  • Apple, Amazon, Facebook and Google all beat Wall Street forecast, with revenues rising to a collective $205.2 billion.
  • Lingering U.S. growth concerns, however, push the dollar to a fresh two-year low, and gold to a fresh all-time high, in overnight trading.
  • U.S. coronavirus cases rise by more than 68,000 Thursday, taking the overall total to 4.6 million.
  • Global oil prices rebound thanks to a weaker U.S. dollar, but demand concerns keep crude tight to its $40 per barrel trading range.
  • U.S. equity futures suggest a firmer open on Wall Street ahead of earnings from Merck, ExxonMobil, Chevron and Colgate before the start of trading and inflation and personal consumption data at 8:30 am Eastern time.

Wall Street futures extended gains Friday, powered by gains for the biggest U.S. tech stocks after blockbuster earnings after the close of trading yesterday, but lingering concerns for the fate of the global economic recovery, and rising coronavirus infection rates, continue to cloud investor sentiment. 

Apple Inc.  (AAPL) - Get Report alone will add at least 150 points to the Dow Jones Industrial Average at the start of trading, thanks to the stock's 6% pre-market rising following last night's blowout earnings report, which included nearly $60 billion in revenues and a better-than-expected bottom line of $2.58 per share. 

Apple's plans to split its shares, which are current trading north of $400 each, could be holding down gains for the Dow, given the tech giant's impact on the price-weighted average. 

Amazon Inc.  (AMZN) - Get Report, too, will provide a big boost to both the S&P 500 and the Nasdaq, with shares up 5.4% in pre-market after the online retailer posted record quarterly profits on sales on nearly $90 billion.

However, Thursday's grim second quarter GDP reading, which showed an annualized contraction of 32.9% -- the steepest since records began -- as well as an uptick in weekly jobless claims, were powerful reminders for investors that any domestic recovery will be predicated on taming the spread of the cornavirus, which has infected 4.6 million Americans and killed at least 154,000. 

In fact, those concerns are being expressed far more dramatically in the value of the U.S. dollar than they are in stocks, with the greenback falling to a fresh two-year low against a basket of its global peers in overnight trading, taking its July decline to around 5%, the most in ten years.

Gold prices, too, have had their best month in nearly five years, rising nearly 11% since the end of June to a fresh record high of $1,974.00 per ounce in overnight trading as new coronavirus lockdown orders were put in place in the United Kingdom, and Japan threatened to impose new restrictions on movement and business in Tokyo amid a fresh outbreak in the capital.

Stocks, meanwhile, are set for mixed opening bell gains Friday, despite the powerhouse impact from Amazon, Apple, Facebook  (FB) - Get Report and Google  (GOOGL) - Get Report, with futures contracts tied to the Dow suggesting a 98 point advance and those linked to the S&P 500, which is up 4.7% for the month, indicating a stronger 21 point jump.

Nasdaq Composite futures, meanwhile, are guiding to a 210 point opening bell gain that would power the tech-focused index to a fresh all-time high.

European stocks booked solid early gains, as well, with the Stoxx 600 rising 0.5% in early trading, paced by a 0.7% gain for the DAX performance index in Germany and a 0.2% dip for the FTSE 100 in London.

The euro, however, is on pace for its best month against the dollar in a decade, having touched the 1.19 level in overnight trading for the first time since May 2018, with the pound rising to a four-and-a-half month high of 1.3138 against the slumping greenback.

Dollar weakness helped global oil prices bounce higher Friday, despite demand concerns linked to the COVID-19 resurgence and mixed industrial data from China.

WTI contracts for September delivery, the U.S. benchmark, 32 cents higher from their Thursday close in New York and were changing hands at $40.24 per barrel in early European dealing while Brent contracts for September, the global benchmark, were seen 38 cents higher at $43.32 per barrel.

Overnight in Asia, Japan's Nikkei 225 slumped 2.82% on the session to push the benchmark into negative territory for the month, driven by last night's declines on Wall Street and a stronger yen, while the region-wide MSCI ex-Japan index, the region's broadest measure of share prices, slipped 0.31% into the final hours of trading.